Shares of Cablevision Systems rose more than 3% ($1.30 per share) to $37.73 per share Thursday, surpassing the $36.26-per-share offer its ruling Dolan family made in May to take the company private and casting further doubt that shareholders will approve the plan.
It was the highest level Cablevision stock has reached in about five years. The shares last traded higher than $37.73 each in March 2002.
The Dolans made their $10.6 billion, $36.26-per-share offer May 2. The proposal was approved by a special committee of independent directors but still needs to pass muster with a “majority of the minority” of shareholders not affiliated with the Dolan family.
Spurring the rise in the share price was a research report issued by Sanford Bernstein cable and satellite analyst Craig Moffett Thursday, which stated that given the company’s growth projections over the next four years, Cablevision could be worth twice what the Dolans have offered.
In a proxy statement filed June 28 with the Securities and Exchange Commission, Cablevision projected that free cash flow could more than double from $1.1 billion in 2007 to $2.65 billion in 2011.
“We believe the case can be made, on the basis of last week’s proxy, that the shares are worth at least twice the current offering price,” Moffett wrote.
